Market Reports
A Mortgage Update from Jay Skwierawski for the week of April 6
Good Morning Everybody!
It's baseball season, finally! A sure sign of Spring.
The Box Score!
Last week's economic reports were, for the most part, mortgage rate friendly, including the all important employment reports released on Friday. We saw both Industrial Supply Manager's indexes come in slightly higher than anticipated, but still showing recessionary levels. Initial claims for unemployment soared to over 400,000, a number not seen in several years. Then, on Friday, the labor department reported that the economy lost 80,000 jobs in March, much worse than the 50,000 job loss that was expected. In addition, January and February's numbers were both revised downward to show an additional 70,000 jobs lost. The unemployment rate also climbed to 5.1% from 4.8%, also much higher than expected. As a result of these numbers, the mortgage bond market rallied and we saw mortgage rates end the week slightly better than where they started.
This week is a slow week as far as economic reporting goes, with the following reports set for release:
Tuesday - The minutes of the Federal Reserves most recent policy setting meeting are released. These can have a HIGH impact on mortgage rates, because it is a good measure of the "pulse of the Fed", and what it thinks about the economy and inflation.
Wednesday - Crude Oil Inventories are released (Moderate Impact on mortgage rates)
Thursday - Balance of trade and weekly initial jobless claims are released (Moderate impact on mortgage rates)
Friday - University of Michigan Consumer Sentiment Index. This is a widely expected measure of how consumers feel about the state of the economy and how they are doing financially.
Know your starting line-up at game time!
In addition to the above mentioned economic reports, there have been a lot of changes in the mortgage industry within the past several weeks regarding underwriting, pricing, private mortgage insurance and condo financing. Now more than ever, it is extremely important for you to have confidence in your mortgage lender. It seems like the major mortgage investors (FNMA, FHLMC and other large buyers of mortgages) are changing guidelines on an hourly basis! If you are dealing with a mortgage lender that is not paying attention, your deal could suffer as a result. Some of the changes that have been announced have gone into effect immediately upon notification, while others have come with some advanced warning. If you have a transaction already in process, and it hasn't been "locked in" with an investor, and the program changes or, worse yet goes away, then it's conceivable that you may be turned down for your mortgage. Also, if you have been pre-approved for your financing, it is very important that your loan officer check the status of the pre-approval as you are making an offer. There have been many instances where buyers have been pre-approved under certain mortgage programs that weren't available when the buyer finally found a house. If you are on the listing end of an offer, and the pre-approval letter that you are being presented is older, or even if it's not older, it would be a great idea for you to verify that the pre-approval is still good with the lender that issued it. Be wary of cheesy-looking preapprovals! We are more than happy to take a look at your pre-approval letters to give you our opinions of them.
Get in the game!
Even with all of the changes that have taken place, now is still a great time to buy. There are still great programs available for qualified buyers. Interest rates are extremely favorable right now for purchasing or refinancing. If you are a buyer that purchased within the last few years, and took out an adjustable rate mortgage because you were planning to move during that initial three to five year period, talk with a lender today. There are great deals and mortgage rates that can be had right now. You may also consider refinancing into a fixed rate if your moving plans have changed.
The Scorecard
Above is the candlestick chart for this week. Remember that green is good, red is bad, up is good, down is not so good! The trend still seems to be upward and green!
Thank you for the trust that you've placed in us as your mortgage partner! If you have any questions regarding any of this information, or any other mortgage related questions, please give your loan officer or me a call!
Thank you!
Jay Skwierawski
President
First Sterling Mortgage Services, LLC
737 North Michigan Avenue, #1900
Chicago, IL 60611
312-268-7601
WE CLOSE ON TIME - EVERY TIME!
is a registered service mark of The Prudential Insurance Company of America. Equal Housing Opportunity. Midwest Realty Ventures LLC. All Rights Reserved.